Costco sued J&J Vision Care a few years ago over anti-consumer behavior in the contact lenses industry (I characterize it as anti-consumer. The Vision Care industry characterizes it as pro-consumer). They dropped the lawsuit in 2016, probably because Johnson and Johnson discontinued the practice: https://www.law360.com/articles/800034/costco-drops-antitrus...
Vermont gas distributors have the highest profit margins in the nation. The gasoline oligopoly here is committed to creating high barriers to entry. This includes buying their competitors just to remove the tanks on premise.
Costco decided they were going to distribute gasoline at its Colchester, VT location. They spent years in court battles with Skip Vallee, owner of R.L. Vallee, Inc., eventually went up to the Vermont Supreme Court, which handed out a decision last year that Costco is permitted to build a gas station.
I always hear stories about Costco being great to their employees, but now seeing that they're so pro-consumer as well makes me feel even better about shopping there pretty regularly. I'm not even their target market, but it's one of my favorite stores.
WRT prices of contact lenses, I use an ultrasonic contact lens cleaner with plain saline (Ringer's will also work if that is cheaper in your area), then storing the contact lenses in my lens solution to disinfect. Far better comfort profile, for far longer, than I ever obtained following the manufacturer instructions of 20 seconds rubbing on each side, and 5 seconds rinsing on each side. The saline is half as much as the normal lens solution, I use it liberally to rinse the ultrasonic cleaner, I get more use out of my contacts, and I use far less normal lens solution. So far I haven't encountered any drawbacks, YMMV.
While we're on the subject, I'm glad Costco does this.
I was just shopping for new eyeglasses this week, and the difference between going to an in-network shop and going to Costco (out of network) is beyond insane. For something that will cost me under $100 for both frames and lenses after reimbursement from Costco, I estimated that I would have paid almost $300 out of pocket after in-network coverage.
Costco might not do enough volume to drive market cost down, but I certainly appreciate that they provide a sane alternative to crazy markups on eyeglasses in stores.
> Companies with deep pockets lock down the market by making it too expensive for competitors to operate and to offer lower-priced yet quality products. It is a legitimate tactic; even those who succumb to it don’t really begrudge the approach.
Who the hell wrote this article, the CEO of Acushnet?
"Don't get the wrong idea, small businesses love being sued over frivolous patents they never infringed upon!"
The source of commentary for this article is pretty suspect, I mean, how did Quartz find golf-patents.com? It seems like the sort of domain which would be set up by a golf patent troll to support a story about them holding patents.
The whois data for golf-patents.com lean toward this line of reasoning. The domain appears to be registered to an IP law firm. I'm not going to claim that they are a troll or a firm which enables trolls, but it is suspect in itself that they are referenced directly.
Acushnet Company does in fact manufacture, market, and sell golf balls, so it is reasonable that they could bring a patent suit as long as it does not turn out to be frivolous. It would be nice to have a system of laws which makes it fair for genuine victims of infringement to file and try suits without bankrupting competitors before the case is settled.
I was under the impression that filing baseless lawsuits was a tort. Furthermore attorneys are required to make a good-faith investigation of their client's case and refuse to take part in frivolous lawsuits. This may be a pretty low bar, but it sounds like Acushnet's attorneys may be failing to clear it.
I think someone complained to Quartz that their articles were biased, so the writer here decided to represent both angles. ("they're just doing business" vs "they're bullying any competition") In my opinion, one of the most difficult lessons the internet age will have to learn is that the truth isn't always in the middle, and that both sides are not exactly the same.
I suppose that "legitimate" here is used in the literal sense, as in "lawful" or "legal".
Unfortunately, these are the rules of the game. Small players may know this and plan accordingly. So when the inevitable happens, they may not like it but they don't need to hold a grudge to the company that did exactly as planned.
Which part are you commenting on? Is it the use of the word "legitimate"?
Because suing someone for patent infringement is a "legitimate" course of action, i.e. it's a lawful thing to do.
In fact (AFAIK IANAL etc etc) it's the only way to ascertain whether a patent is being infringed or not without working with the opposition directly and sharing trade secrets outside the context of a court room with proper protections, something I doubt anyone would be particularly happy about.
If it's the "don't really begrudge the approach" part. I don't know that any of us really have the knowledge from within the golfing industry to know what different companies think of the practice.
Ironically, anti-competitive moves like this are only going to accelerate the game of golf's steady decline[0]. I get needing to protect your market as a large player, but when you are the main player and your product is too expensive to buy and the perception is growing that the sport you specialize in is a waste of time and money, what good does it do to push out someone making a cheaper product that may allow beginning players with smaller budgets to enter the game?
Ehh, you can get perfectly serviceable balls for even cheaper than the costco ball.
I bought 10 dozen Top Flite Gamer balls as my winter ball (you tend to lose more balls in the winter due to plugging into the ground, taller rough, etc.) for $9.99/dozen on Christmas sale. I play $48/dozen balls regularly as well, but I'm perfectly content playing the $1 ball.
MSRP-wise, Pinnacle balls have been a perfectly fine ball for beginner to intermediate golfers for decades. (I used to be an advanced level player but dropped the game for a decade, and when I picked it up again I opted to use a Pinnacle ball for a few years for the roi)
The reason the Costco ball is alarming to the premium ball manufacturers isn't because a cheap good ball exists now (they always have existed), but because a cheap great ball (i.e. tour pro level) threatened to destroy their margins. Basically, it would destroy the "money buys you performance" marketing mystique (even though for 99% of players, they don't get the clubface/ball contact to get that performance out of the ball anyways).
Also you can get really good equipment for quite cheap on ebay. It's not like technology has changed much for most of the set. My favorite irons are from 1991. (that being said, unless you know someone who really knows their equipment, bargain hunting on ebay might be difficult due to information overload)
The decline of the game is due to a variety of factors. Most important of these is Tiger Woods' demise, and secondary factors include pace of play at golf courses (rounds should be less than 4 hours, not 5+) as well as the inflated prices at many of these places that happened during the boom years.
Whether that's true or not, I don't think it's enough to rely on the invisible hand to squelch this practice. The truth is, as long as it is advantageous to sue frivolously, companies will do it. And this is bad for the free market, the economy, and consumers.
Policy change should make it much more costly to launch a frivolous lawsuit (as distinct from a claim made in good faith), e.g. by making it much easier for a bullied defendant to counter-sue and win significant damages.
The fact there is a high barrier of entry might be one of the only appeals golf has at all? Playing it is a status symbol. Although, I think maybe that elite status symbols themselves may be on a downswing, maybe because of the growing awareness of wealth inequality?
Super rich people used to ride around in stretch limos and people found it interesting and exciting, now there's a growing perception that's disgusting and super rich people tend to visibly travel in much more inconspicuous vehicles (which are taking them to their private jets).
This article is very sparse on details. For one, the factory that makes the Costco balls primarily makes Taylor Made balls. The manufacturer is a Korean company that used its excess capacity to make Costco's balls. Taylor Made sells premium balls so they're pressuring the manufacturer to not do this in the future.
Also i haven't seen any details about Costco having a golf ball design team. Where did this design come from? Did they contract it out to one of the small manufacturers that he article refers to? That's mainly the thing I want to know, since if it's truly their design that they own, then they'll be able to find someone to make it for them.
Also Aschunet isn't that deep pocketed. Their annual revenues are $1.5B with ~$70M shares outstanding and an EPS of about 6, so about $400M in profit, and operating income is in the range of $150M. https://forum.mygolfspy.com/topic/14841-acushnet-losing-sale...
Unlike the small ball companies they sued, Costco is a much bigger company than Acushnet and can afford to fight them off, especially since Costco has the distribution scale, hype, and demographic fit perfectly suited to really move the needle with this product (The upper middle class family with disposable income that is budget conscious, which is Costco's main market, is perfect for a budget high performance golf ball, which is a perishable sporting good that you need to buy hundreds of if you play regularly).
(Fwiw it is very common in the sport to have small upstart club makers. Basically all you need is a milling machine to make a perfectly reasonable iron or putter, and every now and then you'll see a random small manufacturers club in a tour player's bag - ex: the Yes! Golf putter when Retief Goosen won both his US Opens)
She isn't wrong about it being a legitimate tactic. You might not like it, it might make you a piece of shit for doing it, but it is a completely legitimate tactic.
the tactic is legitimate, sure. But do ALL those people who succumb to the tactic really not begrudge the approach? I highly doubt it. QZ found one guy who was not upset and uses that to justify the prior claim... booo qz booo
This shows everything wrong with IP today. There should be no place for legal bullying. Especially when it's as simple as crushing competitors under litigation costs.
Especially the cynical practice of filing known-baseless patent suits as described in the article. That behavior should get the company heavily fined, and land the responsible corporate actors in prison.
I used to work for a law firm as a programmer/analyst, after that DMCA and changes to patent and copyright laws, it is easy to just sue a small company until their court costs and attorney fees exceed their income and they have to settle out of court or reach an out of court settlement.
Disney and other companies like DC and Marvel wanted the Trademark law to keep getting modified so they still owned the rights to their characters and they would not go into public domain as our founding fathers wanted.
Yeah, this is legal bullying, sort of like taking the competitor and roll them in a rug and start beating them with bats until they give up.
I would have appreciated some more information about these patents. Like instead of telling me the lawsuit is all hot air, show me? I feel they deliberately omitted any facts which might allow me to form any opinion other than the one I'm supposed to have. (I'm happy to believe the lawsuit is bullshit, but not based on nothing but say so.)
"“We laughed when we got the lawsuit. We knew we made it.”"
and
"his company settled the 2015 claims with Acushnet by agreeing to get out of the golf-ball business altogether; it received no payment from Acushnet, nor did it pay."
I think at some point in your life, if you're creating or performing, you'll reach a point where your critics have a significant audience. At that point, you can give yourself a small pat on the back, you've managed to make a splash in the status quo.
You celebrate the small victories even when you know you're about to hit a big setback. They're not mutually exclusive. In fact being able to appreciate the wins despite the losses is partly how you stay resilient.
Companies that knowingly waste the courts time by filing frivolous lawsuits should be heavily punished. Acushnet is not defending their patents, they're just trying to prevent competition. They're fully aware that no patents were violated because they've already examined the KS balls extensively for infringement. This case will never make it court for the simple reason that their hand has been thoroughly exposed.
I love Costco. They pay good wages (with benefits), have good quality products, and great prices. They have a kick ass return policy. And they stick it to patent trolls. Fuck yeah, Costco. Keep it up.
American courts should have a "Loser pays" rule, and stricter standards for determining what is a frivolous lawsuit warranting additional penalties for the filer.
American jurisprudence has always favored making sure "everyone gets their day in Court" to the point where trolls and professional litigants are ruining things.
Everybody's quick to call this "bullying". How are all of you so sure that Costco didn't indeed steal intellectual property? Or the fact that small companies got sued before means that it were frivolous lawsuits - because, being small, they couldn't have possibly done anything bad like stealing IP?
I don't know anything about this issue, but at least I know I don't know it. What I don't understand is whether all the HN commentators get the idea that they know the situation good enough to jump to conclusions here.
1) Acushnet is trying to keep Costco from entering the market, but once Costco sells a significant number of its golf balls, Acushnet will have to deal with the economic ramifications.
2) Streisand effect - this lawsuit plays really well for Costco, namely that it gives them a lot of free publicity and hype around their supposedly amazing golf balls.
The law is there to protect us but this is an example of how the high cost of going to law facilitates oppression.
The same goes when it comes to dealing with the government.
A government official has no personal liability with respect to any decision they make and has essentially bottomless pockets if it goes to court.
It means for example that a revenue officers decision is final when it comes to the interpretation of tax law in your case, unless you're very rich.
I'm sorry, but shouldn't it be the responsibility of the party making the claim to provide evidence of patent infringement before the defendant is ever even affected?
What a sad state of affairs our court system is in if even a known false lawsuit can be devastating.
If parties generally cannot afford to defend claims such as this, surely this reflects poorly on access to justice. Justice only available to the rich?
How can one claim a state based on the rule of law, if it is not accessible to all in a timely manner?
[+] [-] aluminussoma|9 years ago|reply
Costco did support a different lawsuit by state of Utah against Contact Lens Manufacturers. The Manufacturers lost their first appeal in December 2016: http://www.sltrib.com/news/4731439-155/contact-lens-makers-l...
Hopefully this will begin reducing the prices of contact lenses. Kudos to Costco for sticking up for its customers.
Here is one manufacturer's opinion on this matter: https://www.alcon.com/content/unilateral-pricing-policy
[+] [-] deadowl|9 years ago|reply
http://www.sevendaysvt.com/OffMessage/archives/2015/06/22/la...
Costco decided they were going to distribute gasoline at its Colchester, VT location. They spent years in court battles with Skip Vallee, owner of R.L. Vallee, Inc., eventually went up to the Vermont Supreme Court, which handed out a decision last year that Costco is permitted to build a gas station.
http://www.sevendaysvt.com/OffMessage/archives/2016/08/05/ve...
[+] [-] eddieroger|9 years ago|reply
[+] [-] yourapostasy|9 years ago|reply
[+] [-] ak217|9 years ago|reply
[+] [-] munchbunny|9 years ago|reply
I was just shopping for new eyeglasses this week, and the difference between going to an in-network shop and going to Costco (out of network) is beyond insane. For something that will cost me under $100 for both frames and lenses after reimbursement from Costco, I estimated that I would have paid almost $300 out of pocket after in-network coverage.
Costco might not do enough volume to drive market cost down, but I certainly appreciate that they provide a sane alternative to crazy markups on eyeglasses in stores.
[+] [-] gthtjtkt|9 years ago|reply
Who the hell wrote this article, the CEO of Acushnet?
"Don't get the wrong idea, small businesses love being sued over frivolous patents they never infringed upon!"
[+] [-] sk5t|9 years ago|reply
You don't often see such a laissez-faire attitude towards one's livelihood amongst small businesses.
[+] [-] microcolonel|9 years ago|reply
The whois data for golf-patents.com lean toward this line of reasoning. The domain appears to be registered to an IP law firm. I'm not going to claim that they are a troll or a firm which enables trolls, but it is suspect in itself that they are referenced directly.
Acushnet Company does in fact manufacture, market, and sell golf balls, so it is reasonable that they could bring a patent suit as long as it does not turn out to be frivolous. It would be nice to have a system of laws which makes it fair for genuine victims of infringement to file and try suits without bankrupting competitors before the case is settled.
[+] [-] paulajohnson|9 years ago|reply
[+] [-] cooper12|9 years ago|reply
[+] [-] GuB-42|9 years ago|reply
Unfortunately, these are the rules of the game. Small players may know this and plan accordingly. So when the inevitable happens, they may not like it but they don't need to hold a grudge to the company that did exactly as planned.
The only solution would be to change the rules.
[+] [-] Buge|9 years ago|reply
[+] [-] unknown|9 years ago|reply
[deleted]
[+] [-] arfar|9 years ago|reply
Because suing someone for patent infringement is a "legitimate" course of action, i.e. it's a lawful thing to do. In fact (AFAIK IANAL etc etc) it's the only way to ascertain whether a patent is being infringed or not without working with the opposition directly and sharing trade secrets outside the context of a court room with proper protections, something I doubt anyone would be particularly happy about.
If it's the "don't really begrudge the approach" part. I don't know that any of us really have the knowledge from within the golfing industry to know what different companies think of the practice.
[+] [-] finaliteration|9 years ago|reply
[0]http://www.mensjournal.com/magazine/the-death-of-golf-201506...
[+] [-] hkmurakami|9 years ago|reply
I bought 10 dozen Top Flite Gamer balls as my winter ball (you tend to lose more balls in the winter due to plugging into the ground, taller rough, etc.) for $9.99/dozen on Christmas sale. I play $48/dozen balls regularly as well, but I'm perfectly content playing the $1 ball.
MSRP-wise, Pinnacle balls have been a perfectly fine ball for beginner to intermediate golfers for decades. (I used to be an advanced level player but dropped the game for a decade, and when I picked it up again I opted to use a Pinnacle ball for a few years for the roi)
The reason the Costco ball is alarming to the premium ball manufacturers isn't because a cheap good ball exists now (they always have existed), but because a cheap great ball (i.e. tour pro level) threatened to destroy their margins. Basically, it would destroy the "money buys you performance" marketing mystique (even though for 99% of players, they don't get the clubface/ball contact to get that performance out of the ball anyways).
Also you can get really good equipment for quite cheap on ebay. It's not like technology has changed much for most of the set. My favorite irons are from 1991. (that being said, unless you know someone who really knows their equipment, bargain hunting on ebay might be difficult due to information overload)
The decline of the game is due to a variety of factors. Most important of these is Tiger Woods' demise, and secondary factors include pace of play at golf courses (rounds should be less than 4 hours, not 5+) as well as the inflated prices at many of these places that happened during the boom years.
[+] [-] tbabb|9 years ago|reply
Policy change should make it much more costly to launch a frivolous lawsuit (as distinct from a claim made in good faith), e.g. by making it much easier for a bullied defendant to counter-sue and win significant damages.
[+] [-] vhold|9 years ago|reply
Super rich people used to ride around in stretch limos and people found it interesting and exciting, now there's a growing perception that's disgusting and super rich people tend to visibly travel in much more inconspicuous vehicles (which are taking them to their private jets).
Just a random thought..
[+] [-] hkmurakami|9 years ago|reply
Also i haven't seen any details about Costco having a golf ball design team. Where did this design come from? Did they contract it out to one of the small manufacturers that he article refers to? That's mainly the thing I want to know, since if it's truly their design that they own, then they'll be able to find someone to make it for them.
Also Aschunet isn't that deep pocketed. Their annual revenues are $1.5B with ~$70M shares outstanding and an EPS of about 6, so about $400M in profit, and operating income is in the range of $150M. https://forum.mygolfspy.com/topic/14841-acushnet-losing-sale...
Unlike the small ball companies they sued, Costco is a much bigger company than Acushnet and can afford to fight them off, especially since Costco has the distribution scale, hype, and demographic fit perfectly suited to really move the needle with this product (The upper middle class family with disposable income that is budget conscious, which is Costco's main market, is perfect for a budget high performance golf ball, which is a perishable sporting good that you need to buy hundreds of if you play regularly).
(Fwiw it is very common in the sport to have small upstart club makers. Basically all you need is a milling machine to make a perfectly reasonable iron or putter, and every now and then you'll see a random small manufacturers club in a tour player's bag - ex: the Yes! Golf putter when Retief Goosen won both his US Opens)
[+] [-] PatentTroll|9 years ago|reply
[+] [-] finaliteration|9 years ago|reply
Maybe I'm mis-reading, but I think the article said that Acushnet was the first one to send a threatening letter claiming IP infringement.
[+] [-] BEEdwards|9 years ago|reply
Maybe I just haven't given up yet, but what the f*ck? This is not a legitimate tactic, this is LITERALLY everything wrong with our present system.
[+] [-] BoysenberryPi|9 years ago|reply
[+] [-] lordnacho|9 years ago|reply
[+] [-] sluggg|9 years ago|reply
[+] [-] xupybd|9 years ago|reply
[+] [-] saidajigumi|9 years ago|reply
[+] [-] orionblastar|9 years ago|reply
Disney and other companies like DC and Marvel wanted the Trademark law to keep getting modified so they still owned the rights to their characters and they would not go into public domain as our founding fathers wanted.
Yeah, this is legal bullying, sort of like taking the competitor and roll them in a rug and start beating them with bats until they give up.
[+] [-] tedunangst|9 years ago|reply
[+] [-] metaphor|9 years ago|reply
[1] http://golf-patents.com/wp-content/uploads/2017/03/20170317-...
[+] [-] shrewduser|9 years ago|reply
[+] [-] sergiotapia|9 years ago|reply
Talk about carving a niche for yourself.
[+] [-] JustSomeNobody|9 years ago|reply
[+] [-] cissou|9 years ago|reply
"“We laughed when we got the lawsuit. We knew we made it.”"
and
"his company settled the 2015 claims with Acushnet by agreeing to get out of the golf-ball business altogether; it received no payment from Acushnet, nor did it pay."
are compatible statements.
[+] [-] exabrial|9 years ago|reply
[+] [-] err4nt|9 years ago|reply
[+] [-] munchbunny|9 years ago|reply
[+] [-] astrodust|9 years ago|reply
[+] [-] bitmapbrother|9 years ago|reply
[+] [-] dbg31415|9 years ago|reply
[+] [-] bmcusick|9 years ago|reply
American jurisprudence has always favored making sure "everyone gets their day in Court" to the point where trolls and professional litigants are ruining things.
[+] [-] dmritard96|9 years ago|reply
But in all seriousness, this is just rent seeking via the patent system.
[+] [-] tomohawk|9 years ago|reply
http://www.washingtonpost.com/wp-dyn/content/article/2006/12...
[+] [-] golergka|9 years ago|reply
I don't know anything about this issue, but at least I know I don't know it. What I don't understand is whether all the HN commentators get the idea that they know the situation good enough to jump to conclusions here.
[+] [-] ALee|9 years ago|reply
1) Acushnet is trying to keep Costco from entering the market, but once Costco sells a significant number of its golf balls, Acushnet will have to deal with the economic ramifications.
2) Streisand effect - this lawsuit plays really well for Costco, namely that it gives them a lot of free publicity and hype around their supposedly amazing golf balls.
[+] [-] duncan_bayne|9 years ago|reply
http://praxeology.net/anticopyright.htm
(Titled "Anti-Copyright Resources", but in fact contains a lot of material relevant to patents, too.)
[+] [-] barking|9 years ago|reply
The same goes when it comes to dealing with the government. A government official has no personal liability with respect to any decision they make and has essentially bottomless pockets if it goes to court.
It means for example that a revenue officers decision is final when it comes to the interpretation of tax law in your case, unless you're very rich.
[+] [-] Skylled|9 years ago|reply
What a sad state of affairs our court system is in if even a known false lawsuit can be devastating.
[+] [-] aryehof|9 years ago|reply
How can one claim a state based on the rule of law, if it is not accessible to all in a timely manner?